Successful Strategy

Good strategy is the key to success of any enterprise. Failing to create or execute one could mean disaster, regardless of the size of the company or the qualifications of the people leading it.

Tips to Formulating a Good Strategy

• Primary Focus: A well formed question as to what is the strategy of the company. For example, how do we expand nation-wide in the next 6 months? How do we increase our revenue by 30% in the next year? How do we make our new product number 1 in the market by 2009?

• Understanding Current Situation: One must know what is going on around the enterprise. For example, know what the competitors are doing. Are there any new players in the market. Has anyone become more aggressive in the market? Where the market is heading. Is it moving to on line purchases from stores? Is it slowing down as compared to last year? Customers. Are they satisfied with the services or are considering choosing others.

• Timeline and Targets: Must be clear of what you want to achieve in which steps in a fixed amount of time. There is no point in having an open ended strategy with no targets. Every target and strategy should be absolutely time bound. The goals should clearly be defined. For example, that the six billboards for our new product shall be up in the city by the end of February 2008. Similarly, the new product release shall hit the shelves of retailers before the Christmas shopping season begins.

• Understanding the Future: Must know where the market, customers, suppliers (and other critical factors like economy, political scenario etc) will be when the strategy is executed successfully. Say, if we are going to launch a new desktop software in 2 years that is slated to capture a niche market. But will the penetration of Internet based products eliminate the desktop software market? Would Google or Microsoft also get into this market with their cheap or free web based products? Will the political instability cause an economic shakeup?
  

• Measuring the Performance: Must gouge and measure your strategy every step of the way. For example, have the revenues increased significantly in the past two quarters to show that we shall achieve the targets by the end of the year? Is the product development meeting the milestones on schedule so that we can achieve our target of launching the new release by Christmas?
  

Factors to failure

• Lack of Communications within the team: Communications within the various departments in the enterprise. One of the most common reasons for failure in strategy is breakdown in communications and not sharing and seeking critical information from each other.

• Being reactive rather than proactive: Spending too much time in firefighting, resolving issues, following up on opportunities and not allocating and spending time on strategic thinking.

• Thinking short term, rather than long term: Most of the time, we think of a few months ahead and not worry about where we will be in the long term. Short term is usually reactive, focuses on doing and is customer driven. The long term is where you want to see your company and what you would like to achieve by that time. It also sets a clear direction and vision for the company.